zkSync is a Layer 2 (L2) blockchain for Ethereum, designed to address the issues of high fees and limited transaction per second (TPS) capacity on the Ethereum network. This platform uses ZK-Rollups technology, which utilizes zero-knowledge proofs (ZKP) to aggregate multiple transactions outside the main network (L1). Only cryptographic proofs of transaction validity and their compressed data are sent to L1, significantly increasing efficiency and reducing costs.
Developed by Matter Labs, zkSync is advertised as a fully open-source product managed by the community. According to Cryptorank, the project has already attracted attention, raising $458 million in investments. In the long term, Matter Labs aims to create an extensive ecosystem. Currently, two blockchains are in operation: zkSync Lite, which processes payments in ETH and ERC20 tokens, and zkSync Era, which supports full-fledged smart contracts. Future plans include the launch of a system of hyperchains (L3) that provide high security. Matter Labs’ goal is to scale the technology to a level that will attract the next billion blockchain users.
zkSync is a new approach to solving the scaling problem known as the blockchain trilemma. This project, like other layer 2 (L2) solutions, aims to find a balance between security, scalability, and decentralization in blockchain networks.
The three factors of the blockchain trilemma
- Scalability: The ability of a system to efficiently process a growing volume of transactions or data without compromising performance or security.
- Security in blockchain: Ensuring the reliability and protection of data from unauthorized access, falsification, or modification.
- Decentralization: The absence of a centralized control structure. In a decentralized system, management and decision-making are democratically distributed among all network participants.
Ethereum is focused on security and decentralization, emphasizing its status as a peer-to-peer protocol with nodes distributed around the world. For up-to-date information on node distribution, please refer to NodeWatch.
Ethereum node distribution
To maintain decentralization in the network, each node must verify all transactions. This makes the network inherently slower. In addition, when the network is under high load, transactions can be very expensive and require significant processing time.
Layer 2
The main task for increasing the TPS of the Ethereum network without increasing the load on nodes was initially to implement Sharding in combination with the transition to PoS (Proof of Stake) consensus. This involved dividing validators into subgroups to process individual segments of the network, thereby reducing the overall load and increasing throughput. However, the community shifted its focus to Layer 2 solutions, given their rapid development.
In addition to the idea of implementing Sharding in Ethereum, other solutions to the scalability problem emerged, such as:
- Payment and State Channels;
- Sidechains;
- Plasma;
- Optimistic Rollup.
As well as technologies based on zero-knowledge proofs (ZKP), including:
- Validium;
- zkRollup;
- Volition.
Although Sharding is still in development, the Dencun hard fork is planned for the near future, which will implement Proto-Danksharding. This intermediate stage aims to improve Layer 2 solutions by making data storage on L1 more economical. Thus, Proto-Danksharding promises to reduce the cost of transactions on L2, being a step towards a full-fledged Sharding solution.
At first glance, L2 blockchains may seem similar, as their main task is to increase the number of transactions outside L1, while delegating the role of security guarantor to L1. Developers of such blockchains often claim that their solutions are the fastest, most reliable, and simplest. In reality, each approach to scaling has its own nuances, and compromises regarding transaction speed, security level, or degree of decentralization are inevitable. Fully centralized solutions are also common. All these aspects bring us back to the fundamental questions of the blockchain trilemma.
This article proposes key criteria for evaluating protocols used in Layer-2 solutions. These include:
- security,
- performance and cost-effectiveness,
- ease of use,
- additional aspects such as smart contract support, EVM bytecode compatibility, and privacy options.
